RBC Capital's analyst Ken Herbert has increased the price target for Kratos Defense (KTOS, Financial) from $32 to $35 while reaffirming an Outperform rating on the shares. This revision is part of a broader assessment focused on the upcoming first-quarter results for the Aerospace & Defense sector.
The analyst indicates that investor confidence in defense stocks is on the rise, largely due to anticipated growth in the fiscal year 2026 top-line figures. Although concerns remain about potential risks linked to DOGE and legacy programs, the prospect of Congressional Republican leaders advocating for an increase in defense spending is bolstering sentiment.
However, the firm highlights some challenges, notably the escalation of trade tensions, which have negatively impacted the positive outlook for Original Equipment (OE) production from major players like Airbus (EADSY) and Boeing (BA). Additionally, recession fears present significant obstacles for aerospace OE stocks.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 10 analysts, the average target price for Kratos Defense & Security Solutions Inc (KTOS, Financial) is $34.10 with a high estimate of $40.00 and a low estimate of $22.00. The average target implies an upside of 2.49% from the current price of $33.27. More detailed estimate data can be found on the Kratos Defense & Security Solutions Inc (KTOS) Forecast page.
Based on the consensus recommendation from 12 brokerage firms, Kratos Defense & Security Solutions Inc's (KTOS, Financial) average brokerage recommendation is currently 2.2, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Kratos Defense & Security Solutions Inc (KTOS, Financial) in one year is $19.03, suggesting a downside of 42.8% from the current price of $33.27. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Kratos Defense & Security Solutions Inc (KTOS) Summary page.
